"Thinking Strategically"
Several years ago I was required to read the book "Thinking Strategically" as the text for a College course on managing conflict. "Thinking Strategically" is not a book that I would typically run across and purchase. Used improperly it is a how-to book on playing zero-sum-games. And although this could give you an offensive advantage I also think that understanding the ideas from the book helps set up a good defense. The book has remained on my current reading bookshelf. I have also purchased copies for my management team. Here's why:
Last year the rural telcos went after UEN. The strategy was to force UEN to use facilities provided by URTA members. The other effect would have been to drive up UEN's costs. This would not have been good legislation. "Why target UEN," I asked? The reply. Because UEN is an easy target. In some ways UEN is perceived as a bunch of nice guys. And I think that's true. Still, it bothers me to be targeted just because we don't have the image of being mean-spirited.
"Thinking Strategically" explains the relatively new science of game theory. The most common example of game theory is the prisoners' dilemma. The dilemma for two prisoners is this: If they both keep their mouths shut, both walk with no punishment. If one holds out and the other tells, the tattle-tale is rewarded with a short sentence and the holdout gets a very long sentence. If both tell then both receive a sentence that is of moderate length.
Each player in the prisoners' dilemma has a dominant strategy. That dominant strategy is to tell on the other guy. Why? Set up the matrix to see why. Telling ensures a short or moderate prison sentence. Not telling leaves you open to either freedom or a very long sentence that very likely means spending the rest of your life in prison. Telling gives a prisoner some control over his/her destiny.
Another useful tool is that of building trees. In this area you develop possible outcomes and work back. The idea is to determine the actions that develop into specific results. Then to determine probabilities from the actions and their likelihood of success. Useful ideas and actions can result when you identify possible outcomes.
Other chapters deal with brinkmanship, scorched earth moves and other strategic games. Many of the ideas are very useful. But you must be careful. Much of what is taught in the book could be very destructive.
I cautiously recommending this book. It is not for everyone. I think that it is important to understand the nature of conflict and how to cope in a highly competitive environment. It's okay to use this book for that purpose.
Quotes from the book:
On Thinking Strategically: "Strategic thinking is the art of outdoing an adversary, knowing that the adversary is trying to do the same to you."
On Brinkmanship: "The essence of Brinkmanship is the deliberate creation of risk."
On Credibility: "Credibility is a problem with all strategic games. ......Establish and use a reputation."
On The Prisoners' Dilemma: What governs the balance between cooperation and competition, not just in business, but also in politics and social settings? This question can be answered, at least in part, using the prisoners' dilemma."
On seeing through your opponent's strategy: "How do you see through all the interlocking but invisible strategies? You must not regard the unknown actions of the other players as being uncertain in an impersonal way like the weather."
The Book: Thinking Strategically: The Competitive Edge in Business, Politics and Everyday Life
The Authors: Avinash K. Dixit and Barry J. Nalebuff
Publisher: W. W. Norton & Company
ISBN: 0-393-31035-3
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